SME consultant warns many contracts were reliant on threatened public sector spending

SME consultant John Rowan & Partners saw turnover rocket by a quarter and profits increase by 13.5% in the past year, but warned that many contracts were reliant on threatened public sector spending. Turnover rose to £6.79m, pre-tax profits grew to £1.11m and staff numbers were up by 13%.

Stephen Gee, managing partner, said the much of the growth was down to public sector work. “You have to say that a lot of that increase was in the public sector,” he said.

Contracts that had come from public sector housing were at risk of being slowed down, Gee warned. “On Decent Homes, maintenance and affordable housing it’s likely that projects will be extended,” he said.

The firm’s order book was “slightly up” compared to last year, Gee said, but the downturn had cut bids by over a tenth and margins had been trimmed.

Gee said: “Bids are certainly down, and some are suicidal bids. Our bids are 12% lower now.” He added that margins were “a couple of percent lower” than before the downturn and were actually worse now than during the depths of the recession.